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Forums For Adjudicating Employment Disputes

Certain claims may be asserted before the Colorado Division of Labor and Employment, the Colorado Division of Civil Rights, and, in some instances, local agencies. Most claims may be asserted in courts of general jurisdiction, although certain claims must first be presented to the appropriate administrative or governmental agency.


The Main Sources Of Employment Law

Common law, state statutes and state regulations are the main sources of employment law in Colorado. Major state employment statutes include the Colorado Anti-Discrimination Act (Colo. Rev. Stat. §24-34-401 et seq.), the Colorado Wage Claim Act (Colo. Rev. Stat. §8-4-101, et seq.), the Colorado Employment Security Act (Colo. Rev. Stat. § 8-70-101, et seq.), the Colorado Workers’ Compensation Act (Colo. Rev. Stat. § 8-40-101 et seq.), and the Colorado Healthy Families and Workplaces Act (Colo. Rev. Stat. § 8-13.3-401 et seq.). Individual contracts (whether written or oral), employee handbooks and policies, and collective bargaining agreements may also govern the employment relationship.


National Law And Employees Working For Foreign Companies

State law applies to all individuals physically working in the state. Federal law and, in some instances, a national treaty with a foreign government may also apply. The parties may contractually agree to apply a different state’s law in some limited circumstances.


National Law And Employees Of National Companies Working In Another Jurisdiction

State law applies when the employee is physically working in the state or when both parties have agreed in writing to the application of Colorado law. There are instances when another state’s labor laws, most notably wage/hour and wage collection laws, can apply to Colorado residents when they work outside the state.


Data privacy

There are no statutory provisions in Colorado regarding data privacy in the employment law context.

Legal Requirements As To The Form Of Agreement

There are no legal requirements regarding the form of an employment agreement, and employment agreements are not required.


Mandatory Requirements
  • Trial Period
  • There is no legal requirement to provide trial periods (also referred to as “probationary periods” or “introductory periods”). The terms of a collective bargaining agreement may apply.

  • Hours Of Work
  • There is no restriction on the number of hours that employees may be required to work, except children. However, employees who are non-exempt under state and federal wage and hour laws are entitled to overtime pay at a rate of one-and-a-half times the regular rate of pay for all hours worked over 40 in a workweek, 12 hours in a workday, or 12 consecutive hours (Colorado Overtime and Minimum Pay Standards (“COMPS”) Order 37). The terms of a collective bargaining or other agreement may also apply and may supersede or override state law minimums.

  • Special Rules For Part-time Work
  • There are no statutory provisions or special rules related to part-time work in Colorado.

  • Earnings
  • All non-exempt employees must be paid the federal or state minimum wage, whichever is higher, for all hours worked (COMPS Order 37). Certain municipalities, such as Denver, set their own minimum wage for employees working within the municipality. Exempt employees must be paid certain minimum weekly salaries or fees in accordance with federal law. Certain employees or occupations are exempt from some provisions of Colorado minimum wage laws, including but not limited to administrative employees, executive/supervisory employees, professional employees, outside sales employees, interstate transportation workers and taxicab drivers, in-residence workers, volunteers, employees in highly technical computer-related occupations, and elected officials and members of their staff (COMPS Order 37).

    In addition, certain types of employees are exempt from the overtime requirements of Colorado minimum wage laws, including but not limited to certain salespersons and mechanics, commission salespersons, ski industry employees, and medical transportation industry employees (COMPS Order 37).

    An employee whose physical disability has been certified by the director to significantly impair such disabled employee’s ability to perform the duties involved in the employment, and non-emancipated minors under 18 years of age , may be paid 15% below the current minimum wage less any applicable lawful credits, for all hours worked (COMPS Order 37). The terms of a collective bargaining or other agreement may also apply.

  • Holidays/Rest Periods
  • Employees are entitled to a paid 10-minute rest period for each 4 hours of work or major fractions thereof. It is not required that the employee be permitted to leave the premises for the rest period. Employees are entitled to an unpaid, uninterrupted and “duty free” meal period of at least a thirty-minute duration when the scheduled work shift exceeds five consecutive hours of work (Colorado Wage Order 31). The terms of a collective bargaining agreement may apply.

  • Minimum/Maximum Age
  • The minimum age for most jobs is 14 years old. Children under the age of 14 are allowed to work only in certain industries. Certain federal and state rules apply to the employment of children under the age of 16 (Colo. Rev. Stat. §8-12-101, et seq.). There are no maximum age limits. The Colorado Anti-Discrimination Act prohibits discrimination on the basis of age for individuals age 40 or older (Colo. Rev. Stat. §2434-401, et seq.). Federal law and the terms of a collective bargaining agreement may also apply.

    Minors under the age of 16 are generally not permitted to work shifts in excess of six hours, unless the next day is not a school day. In addition, minors under the age of 16 are generally not permitted to work between the hours of 9:30 P.M. and 5:00 A.M.

  • Illness/Disability
  • Beginning January 1, 2024, employees who have earned at least $2,500 at their job and submit an application for leave may take up to twelve weeks of paid leave related to (1) a serious health condition; (2) caring for a family member with a serious health condition; or (3) safe leave due to domestic violence. This leave is job-protected for any employee who has been employed by their employer for at least 180 days.

    Beginning January 1, 2023, employers must remit premiums equal to a percentage of each employee’s wages to fund the state paid family leave program.

    Federal and state law impose specific anti-discrimination and leave requirements for employees with a disability or serious medical condition. The terms of a collective bargaining agreement may also apply.

  • Location Of Work/Mobility
  • There are no statutory provisions regarding location of work or mobility.

  • Pension Plans
  • There are no statutory provisions regarding pension plans. Federal law is dominant in the pension and employee benefits area.

    In 2020, the Colorado Secure Savings Program was created. It has yet to be implemented and no implementation date is set. Once the program is in effect, most Colorado employers will be required to either offer an employer-sponsored retirement plan or enrol their employees in an individual retirement account plan (Colo. Rev. Stat. §24-54.3-101 et seq.).

  • Parental Rights (Pregnancy/ Maternity/ Paternity/ Adoption)
  • Beginning January 1, 2024, employees who have earned at least $2,500 at their job and submit an application for leave may take up to twelve weeks of paid leave related to the birth, adoption, or placement of a child. An employee who has a serious health condition related to pregnancy complications or childbirth complications is entitled to take up to an additional four weeks of paid leave. This leave is job protected for any employee who has been employed by their employer for at least 180 days.

    Beginning January 1, 2023, employers must remit premiums equal to a percentage of each employee’s wages to fund the state paid family leave program.

    Federal leave requirements and the terms of a collective bargaining agreement may also apply.

  • Compulsory Terms
  • There are no compulsory terms that must be included in an employment agreement.

  • Non-Compulsory Terms
  • The employer and employee may agree to any terms, provided that the terms do not abrogate statutory rights (e.g., employees may not agree to compensation less than the minimum wage or waive their right to overtime compensation or worker’s compensation) (Colo. Rev. Stat. §8-4-121).


Types Of Agreement

Employers and employees may enter into a variety of agreements related to the employment relationship including standard employment agreements (regarding hours, wages, benefits, etc.), confidentiality and non-disclosure agreements, non-competition agreements, non-solicitation agreements, etc. Common law and state statutes will determine the enforceability of such agreements.


Secrecy/Confidentiality

There are rules relating to secrecy and confidentiality that are implied in the employment relationship. During the employment relationship, an employee is under a duty of loyalty and must not act contrary to the employer’s interest by, for example, misappropriating or improperly disclosing trade secrets. Colorado’s Uniform Trade Secrets Act regulates the misappropriation of trade secrets both during and after employment (Colo. Rev. Stat. §7-74-101, et seq.). Employers and employees may also enter into confidentiality and non-disclosure agreements, although covenants restricting trade are void except to protect disclosure of trade secrets, among other exceptions (Colo. Rev. Stat. §8-2-113).


Ownership of Inventions/Other Intellectual Property (IP) Rights

There are no statutory provisions regarding employee ownership of inventions and other intellectual property rights. Contractual provisions and federal law may apply.


Pre-Employment Considerations

Employers cannot ask applicants about their current pay or their wage rate history during the application and hiring process (Colo. Rev. Stat. §8-5-102).

In addition, Colorado employers must provide notice of open employment positions or opportunities for advancement to all of their current employees (Colo. Rev. Stat. §8-5-201). This requirement applies to open positions in Colorado and positions which could be performed from anywhere, including Colorado. The notice must include the salary, other compensation, and benefits that the employer expects to offer for the position. (Colo. Rev. Stat. §8-5-201).

Colorado law prohibits employers from asking applicants on an initial employment application about their criminal history, including arrests, charges, pleas, or convictions of any misdemeanor or felony. (Colo. Rev. Stat. §8-2-130). The law does not extend to the remainder of the hiring process.


Hiring Non-Nationals

Employers who transact business in Colorado are required to: (1) Make an affirmation within 20 days after hiring a new employee that the employer has examined the legal work status of the newly hired employee; has not falsified the employee’s identification documents; and has not knowingly hired an unauthorized non-national. The employer must keep a written or electronic copy of the affirmation for the term of employment of each employee; and (2) The employer must keep a written or electronic copy of the employee’s documents required by 8 U.S.C. §1324a (commonly known as Form I-9 identity and employment authorization documents). The copies must be retained for the term of employment of each employee (Colo. Rev. Stat. §8-2-122). All employers must also ensure that all employees are eligible to work in the United States in accordance with federal law (e.g., completion of I-9 Form).

 

Hiring Specified Categories Of Individuals

There are restrictions on the types of work that children may be hired to perform. For example, children under age 16 may not be employed in hazardous or detrimental occupations (Colo. Rev. Stat. §8-12-101, et seq.).


Outsourcing And/Or Sub-Contracting/Temporary Agency Work

There are no provisions regarding outsourcing and/or subcontracting. The terms of a collective bargaining agreement may apply.

Changes To The Contract

Changes to an employment contract are generally governed by the contractual terms and common law. Any contract containing covenants not to compete must have consideration, which can include initial employment or continued employment of an at-will employee.


Change In Ownership Of The Business

Parties may implement provisions restricting trade, including non-competition agreements, in connection with a change in ownership of the business (Colo. Rev. Stat. §8-12-113). Contractual provisions and federal law may apply.


Social Security Contributions

Employers and employees are both required by federal law to make social security contributions. Employers are also required by state law to make contributions for unemployment benefits and may also be required to pay for workers’ compensation insurance (Colo. Rev. Stat. §8-40-101, et seq.).


Accidents At Work

Employee injuries occurring at work are governed by the Colorado Workers’ Compensation Law (Colo. Rev. Stat. §8-40-101, et seq.). Employers may also be responsible under common law for accidents caused by the acts of their employees. Federal occupational health and safety laws may also apply.


Discipline And Grievance

bargaining agreement or other contract may apply.


Harassment/Discrimination/Equal pay

The Colorado Anti-Discrimination Act prohibits discrimination in employment on the basis of race, color, religion, national origin, gender, marital status/family relations, sexual orientation, ancestry, age (40 and older), or disability. With certain exceptions, this provision applies to any person employed by an employer, except a person in the domestic service of any person (Colo. Rev. Stat §24-34- 301, et seq.). The Colorado Anti-Discrimination Act and the Colorado Equal Pay for Equal Work Act also prohibit employers from paying employees of a certain gender a wage rate less than the wage rate paid to employees of a different gender who perform the same quantity and quality of the same classification of work, unless the pay differential is based on seniority, geographic location, education, or other qualities (Colo. Rev. Stat. §8-5-102). Colorado also follows federal laws prohibiting employers from using genetic information or genetic test results to distinguish between, discriminate against, or restrict the rights or benefits of current or prospective employees, nor are they allowed to disclose an employee’s genetic information.


Compulsory Training Obligations

There are no statutory provisions regarding compulsory training obligations.


Offsetting Earnings

In addition to deductions mandated by local, state, or federal law, an employer may make deductions for loans, advances, goods and services, equipment or property provided, insurance and other benefits, garnishments, and other deductions for theft or shortages if certain proper steps are undertaken (Colo. Rev. Stat. §8-4-105(1)). An employer may not make deductions below minimum wage (Colo. Rev. Stat. §8-4-105(2)).


Payments For Maternity And Disability Leave

As of 2021,there are no statutory provisions currently in effect regarding payments for maternity and disability leave. Contractual provisions and federal law may apply. Beginning January 1, 2024, employees who have earned at least $2,500 at their job and submit an application for leave may take up to twelve weeks of paid leave related to (1) the placement, adoption, or birth of a child; (2) the employee’s serious health condition; (3) caring for a family member with a serious health condition; or (4) safe leave due to domestic violence. This leave is job-protected for any employee who has been employed by their employer for at least 180 days.

Beginning January 1, 2023, employers must remit premiums equal to a percentage of each employee’s wages to fund the state paid family leave program.


Compulsory Insurance

All public and private employers in Colorado, with limited exceptions, must provide workers’ compensation coverage for their employees if one or more full- or part-time persons are employed. A person hired to perform services for pay is presumed by law to be an employee. This includes all persons elected or appointed to public sector service and all persons appointed or hired by private employers for remuneration (Colo. Rev. Stat. §8-40-101, et seq.).


Absence For Military Or Public Service Duties

Time off for the performance of military obligations is protected under both federal and Colorado law. An employer may not refuse to hire, discriminate against, or discharge a person due to service or intended service in the National Guard or state militia (Colo. Rev. Stat. §28-3-506). Leave without pay must be granted for additional periods of compelled service for up to 15 days per year. Private employees have reinstatement rights to the same or similar position (Colo. Rev. Stat. §§28-3-609 and 610.5).

Jury Duty: a Colorado employer can require a worker to report to work after jury duty, if the jury duty does not last throughout the employee’s entire shift. Under C.R.S. §13-71-126, an employer must pay the worker their usual wages, up to $50 per day, for the first three days of jury duty. An employer may pay the worker more, by mutual agreement. This law applies to full-time, part-time and temporary workers who have worked for the same employer for 3 months or more.

Voting: As a general rule, Colorado employers must provide employees who are eligible voters up to two hours off with pay if the employee does not have three consecutive hours off to vote between the time of poll opening and closing, 7 a.m. and 7 p.m.


Works Councils or Trade Unions

Two or more persons have the right to organize and bargain collectively with an employer (Colo. Rev. Stat. §§8-2-101, 8-3-106). State employees also have the right to bargain collectively (Executive Order D 028 07). Federal law may also apply.


Employees’ Right To Strike

All private employees have the right to organize and bargain collectively through representatives of their own choosing (Colo. Rev. Stat. §8-3-106). State employees have a qualified right to strike. Under the Industrial Relations Act, a state employee’s right to strike is conditioned on whether the Director of the Division of Labor chooses to exercise jurisdiction over the labor dispute. Federal law may also apply.


Employees On Strike

Generally, federal law applies to employees engaging in strike, picketing or boycott activities. State and local laws may apply when there is strike violence.


Employers’ Responsibility For Actions Of Their Employees

Under the doctrine of respondeat superior, an employer may be liable for the negligent acts or omissions by an employee that are committed within the course and scope of employment. Employers may also be liable for negligent hiring and/ or retention where the following elements are met: (1) the employer knew or should have known of an employee’s dangerous proclivities; (2) the employee was hired (or retained in employment); (3) the employer’s negligent act or omission was the proximate cause of an injury sustained by the plaintiff at the hands of the employee; and (4) the employee’s misconduct was consistent with the employee’s dangerous proclivity. For this claim, it is not necessary that the offending conduct occur within the course and scope of employment.

Procedures For Terminating the Agreement

There are no statutory provisions regarding procedures for terminating an employment agreement. Unless an employment contract with a specific term applies, the employment relationship is at-will and may be terminated at any time, as permitted by law. An employment contract or collective bargaining agreement may specify termination procedures.


Instant Dismissal

There are no statutory provisions regarding instant dismissal of an employee. Unless an employment contract with a specific term applies, the employment relationship is at-will and may be terminated at any time, as permitted by law. An employment contract or collective bargaining agreement may contain notice, pay in lieu of notice and/or severance requirements.


Employee's Resignation

There are no statutory provisions regarding employee resignation. An employment contract or collective bargaining agreement may specify resignation procedures.


Termination On Notice

There are no statutory provisions regarding termination on notice. An employment contract or collective bargaining agreement may contain notice requirements.


Termination By Reason Of The Employee's Age

The Colorado Anti-Discrimination Act prohibits discrimination in employment on the basis of age (40 or older) (Colo. Rev. Stat. §24-34-401, et seq.). Federal law also applies.


Automatic Termination In Cases Of Force Majeure

Colorado has no statutory provisions regarding termination in cases of force majeure.


Collective Dismissals

There are no statutory provisions regarding collective dismissals. Federal law may apply, or the terms of an employment contract or a collective bargaining agreement may dictate the terms of a collective dismissal.

However, when two (2) or more employees are terminated on the same day or within a short period of time for the same reason, such as with a reduction in force, the OWBPA requires employers to include specific language in any severance agreement offered to employees if at least one of them is 40 or older, and a waiver of rights is included. Specifically, the employees that are 40 or older must be given up to 45 days to consider the severance agreement (instead of 21 days), and the employer must provide specific information related to the “decisional unit” of the company affected by the terminations (including ages and positions).


Termination By Parties’ Agreement

The parties are free to terminate the employment relationship on any grounds they desire, except for unlawful reasons proscribed by federal, state, or local law.


Directors Or Other Senior Officers

There are no statutory provisions regarding termination of directors and officers. An employment contract may apply and contain termination procedures. The termination of employment does not automatically terminate board membership. Separate steps, generally set forth in the bylaws or articles of incorporation/organization, are required to terminate board membership.


Special Rules For Categories Of Employee

There are no statutory provisions regarding the termination of certain categories of employees; however, termination decisions must comply with the anti-discrimination provisions of the Colorado Anti-Discrimination Act.


Whistleblower Laws

State employees are protected against retaliation for whistleblowing (Colo. Rev. Stat. §24-50.5-103), but there is no statutory provision related to private-sector employees.


Specific Rules For Companies in Financial Difficulties

There are no statutory provisions regarding companies in financial difficulty, but there are Federal laws in relation to bankruptcy. Employee Retirement Income Security Act (“ERISA”), the Worker Adjustment and Retraining Notification Act, and other federal laws may apply. Colorado has no state WARN statute.


Special Rules For Garden Leave

There are no statutory provisions or special rules related to garden leave. An employment contract may apply and contain a garden-leave clause.


Restricting Future Activities

Contracts in restraint of trade are unlawful in Colorado, and restrictive covenants limiting individuals in the exercise or pursuit of their occupations are in restraint of trade. However, reasonable non-competition and non-solicitation agreements are permitted (1) to protect confidential or trade secret business information; (2) in the context of the sale of a business; (3) between the company and an individual in an executive or managerial position.

The agreement must be reasonable in both duration and geographic scope and must be supported by consideration (continued at-will employment constitutes sufficient consideration under Colorado law). Enforceability of restrictive covenants is determined on a case-by-case basis. In Colorado, if a court finds that an agreement is too broad, the court has the power to modify (i.e., blue pencil) the agreement to the extent necessary to make it reasonable, although modification is not required (Colo. Rev. Stat. §8-2-113).


Severance Payments

There are no statutory provisions regarding or requiring severance payments. Severance payments are not required unless the employer and the employee have a contract providing for severance. There are specific rules governing the validity of a release provided in exchange for severance payments.


Special Tax Provisions And Severance Payments

Severance payments are taxed in the same way as other wages. Federal law may also apply.


Allowances Payable To Employees After Termination

Employees may be entitled to unemployment benefits paid through a state unemployment compensation agency primarily funded by employer taxes after termination of employment so long as they meet certain requirements.


Time Limits For Claims Following Termination

Statutes of limitation vary depending upon the nature of the claim.

Specific Matters Which Are Important Or Unique To This Jurisdiction

Prohibition of discrimination on the basis of lawful off-duty activity: Colorado prohibits an employer from taking adverse action against an employee due to that employee’s engaging in any lawful activity off the premises of the employer during nonworking hours, unless certain limited exceptions apply (Colo. Rev. Stat. §24-34-402.5).

Paid Sick Leave: Colorado employees are entitled to accrue one hour of paid sick leave for every 30 hours worked, for up to 48 hours per year. (Colo. Rev. Stat. §8-13.3-403).

Health Insurance Continuation: Colorado law requires employers who are not covered by the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) to offer health insurance continuation upon a qualifying event of up to 18 months unless the individual becomes eligible for other group coverage. Continuation is available for individuals or their dependents who have had 6 months of continuous coverage under the group policy. The employer is obligated to notify employees of their continuation rights (Colo. Rev. Stat. §10-16-108).

Recordkeeping requirements: Employers are required to keep records of each employee’s job description and pay history during each employee’s employment and for two years thereafter. (Colo. Rev. Stat. §8-5-202).



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© 2021, Polsinelli PC. All rights reserved by Polsinelli PC as author and the owner of the copyright in this chapter. Polsinelli PC has granted to Multilaw non-exclusive worldwide license to use and include this chapter in this guide and to sublicense Lexis Nexis, a division of RELX Inc. and its affiliates certain rights to use and distribute this Guide.

The information in the How to Hire and Fire Guide provides a general overview at the time of publication and is not intended to be a comprehensive review of all legal developments nor should it be taken as opinion or legal advice on the matters covered. It is for general information purposes only and readers should take legal advice from a Multilaw member firm.

Publication Date: June 2021